Tag Archive for Charter Schools

Special “People”, Special Countries, Special States, and Special Schools

This is a crosspost from the “Dollars & Sense Real World Economics” Blog, authored by CPEG’s Ron Baiman.

It’s been interesting following the recent press on corporate tax avoidance, and in Chicago, the ignominious public school closings. I thought it would be useful to take a minute to draw out the linkages.

The biggest revelation from Apple’s tax avoidance strategy has been it’s scheme to set up “corporate persons” who don’t reside anywhere.1 Apple set up an Irish subsidiary incorporated in Ireland (and therefore not liable for U.S. corporate taxes) but managed from California (and therefore not subject under Irish law to Irish taxation) that has rights to the income from all of the companies trademarks and patents in Asia, Africa, and Europe. Presto! This special corporate person is not legally liable for any taxes – a step up from the usual multinational “transfer pricing” and “off-shore” tax haven strategies where the poor “corporate person” still has to at least have a place of residence!

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